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How businesses treat their employees during the Covid 19 crisis will lead to a reckoning – a very bitter one if times get hard. A famous poster, headlined “What did you do in the war daddy?”, was designed to shame men into volunteering for the army during world war one. It could be adapted in our time for bosses- “When the pandemic struck, how did you look after your workers?”

We will learn who the good guys and the bad guys are at some point in the next couple of years (or even right now- given the speed of social media at outing the clothe eared or arrogant) Personal reputations and brands will be destroyed or enhanced.

In the 2008 crash,  RBS was nationalised by the UK government because it was about to go bust – with horrible consequences for personal finances. CEO Fred Godwin, poster boy of red in tooth and claw acquisitive capitalism, changed status from captain of the universe to vilified pariah in a just few days. Looking back on 2008, remarkably few people lost their reputations, but that was because we found it difficult to work out who the guilty people were (such are the opaque complexities of modern big finance)

This time it will be different. We can all see that Spurs ( for example) have decided to furlough  their back room staff whilst paying in full the wages of their multi-millionaire players.

Media are different – 12 years on from the crash of 2008, social media are even more widely used and the bad guys will be outed quickly. Gary Lineker, a prolific tweeter, has pointed out how grotesque the Spurs decision looks.

The unpredictable factor is how bad things will get over the next months

Many workers are only one pay check (or freelance fee) away from debt – because over the past decade or more wages have stagnated. Now they have nothing to fall back on and without funds the consequence will be widespread poverty and desperation that conjures up images of 1920s great depression. The atmosphere could get very bitter indeed.

This crisis will produce many more Fred Goodwins. And good guys too – Eddie Howe, manager of Bournemouth, was the first manger to offer to take a pay cut. His fast and generous action will stand him in good stead.

But it is already clear that the likes of Daniel Levy ( of Spurs) and Mike Ashley ( of Newcastle FC) think that they are immune from public backlash. They will, i believe, be proved wrong. Let’s hope so.

 

Scandal ! ( click/share), Shock ! (click/share), Outrage !!( click/share), Anger !**! (click/Share)

This is how Facebook grew its audience very fast and sold lots of ads over the past few years. It became, as the jargon has it, ” a publishing platform” and exercised the minimum possible control on what got posted lest it cool down all that profitable posting. I expect that Zuckerberg will still try to pull off this strategy in regions of the world where regulators & policymakers are not sharpening their pencils ( i.e. most of the world outside of USA and Europe). It is easy money.

Zuckerberg wanted all the revenue but little of the responsibility that came with being a publisher. Facebook now employs armies of people to check what goes up on its platform because, as we now know, he got into a lot of trouble for being so lax. But it won’t work: Facebook is now so huge this effort resembles the fabled king Cnut who went down to the beach and instructed the tide not to come it.

Facebook will continue to get into trouble

Facebook will continue to get into trouble, no matter how much tech’ and how many people are monitoring content. Zuckerberg will be dragged blinking into the spotlight and will look bad under scrutiny. High minded platitudes about “connectivity”, “community” and “free speech”, that play well in California, will look increasing empty.

Go WeChat

Facebook will shift focus from social networking amongst large groups of people to private messaging between individuals and small groups ( like Messenger, which it owns, and WeChat in China) for two big reasons

  1. Avoiding responsibility. Facebook cannot be held responsible for what is posted, (especially if it is encrypted and they cannot see it), just as BT cannot be held responsible for people making abusive phone calls to each other or scamming.
  2. Generational change. My children rarely use Facebook and prefer messaging between small groups and individuals. It is the way things are going

How will Facebook make money ? 

Private messaging is largely incompatible with being interrupted by ads. So, expect Facebook to evolve into a kind of all purpose utility – making money from e-commerce and financial services. Facebook will innovate and buy up companies in these areas.

Zuckerberg does not have to imagine what this will look like, as WeChat got there a few years ago – this vid, which is worth a view, explains how. Posted in 2016 it is probably already out of date

 

 

 

For the 20 anniversary issue of Market Leader I looked back to the predictions made by The Economist in 1998 (what did they get right and wrong ?) and brought it up to date with 2018 predictions.

Looking back was fascinating – The Economist got a lot right but on a couple of things they got it completely wrong – especially when it came to the Queen v Tony Blair

This article is reproduced with the permission of WARC.com. See Link to PDF

018-019 Saunders